Revenue Beat: Orion S.A. Exceeded Revenue Forecasts By 7.1% And Analysts Are Updating Their Estimates

It's been a sad week for Orion S.A. (NYSE:OEC), who've watched their investment drop 12% to US$4.59 in the week since the company reported its third-quarter result. It was a workmanlike result, with revenues of US$451m coming in 7.1% ahead of expectations, and statutory earnings per share of US$0.76, in line with analyst appraisals. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Following the recent earnings report, the consensus from five analysts covering Orion is for revenues of US$1.78b in 2026. This implies a small 2.7% decline in revenue compared to the last 12 months. Orion is also expected to turn profitable, with statutory earnings of US$1.13 per share. Before this earnings report, the analysts had been forecasting revenues of US$1.78b and earnings per share (EPS) of US$1.47 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.

View our latest analysis for Orion

It might be a surprise to learn that the consensus price target was broadly unchanged at US$9.10, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Orion analyst has a price target of US$15.00 per share, while the most pessimistic values it at US$4.50. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 2.1% by the end of 2026. This indicates a significant reduction from annual growth of 8.4% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.1% per year. It's pretty clear that Orion's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Orion. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Orion's revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Orion going out to 2027, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 2 warning signs for Orion (1 makes us a bit uncomfortable!) that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.